The Finch Formerly Known As Gold

4 March 2005

Raiders of the Deep Rock

As of yesterday, billionaire Carl Icahn was the largest single stockholder in Oklahoma City's Kerr-McGee Corporation, controlling about 4.68 percent of KMG stock. Icahn associate Barry Rosenstein controls about 3 percent of KMG.

Typically for Icahn, he began making suggestions. In a letter to Kerr-McGee chairman Luke Corbett, Icahn suggested that the chemical business be spun off and that the oil-production business start selling future production in advance while prices are high. "Never before," said Icahn, "has there been such a disconnect between the stock market valuation of publicly traded (exploration and production) companies such as KMG . . . and the value at which oil and gas futures are trading in the commodity markets."

And while he was at it, Icahn nominated himself and Rosenstein to the Kerr-McGee board, a move which was not greeted warmly by management.

The most likely outcome? KMG will follow Icahn's recommendations to the extent that they get the stock price up to where he wants it, and then will pay him handsomely to go away.

Posted at 11:45 AM to Soonerland


Any way to get Icahn to suggest the company rehire Acidman down yonder in Effingham County, Georgia?

Posted by: McGehee at 7:41 AM on 5 March 2005

I doubt it. He's got his heart set on selling off the chemicals side of the business.

Then again, Acidman might stand a better chance with new ownership.

Posted by: CGHill at 7:58 AM on 5 March 2005

Biographical note: Dear Old Dad once worked for a South Carolina chemical facility that was absorbed by Kerr-McGee; they eventually closed that plant, but he'd transferred elsewhere by then. He has since retired.

Posted by: CGHill at 12:02 PM on 5 March 2005

Thought it was real interesting when Kerr McGee got completely out of the retail gasoline business. I wonder if the story of Karen Silkwood had anything to do with it? I can tell you I never bought any more of their gas after seeing that movie.

Posted by: ms7168 at 9:11 AM on 6 March 2005

I rather doubt it. Silkwood died in 1974; KMG didn't dispose of the last of its retail and refining facilities until 1995.

Posted by: CGHill at 9:25 AM on 6 March 2005